Spring ’21 Inspiration Lecture 2
Is Financial Inclusion beneficial for Banks?
Prof. Sushanta Mallick, PhD (Warwick)
Professor of International Finance
School of Business and Management
Queen Mary University of London
Tuesday, March 16, 6:30PM-8:00PM.
This paper investigates whether inclusive banking can boost bank-level performance, using an international sample of 1,740 banks over the period 2004-2015. We find that there is a significant positive association between financial inclusion and bank efficiency. Greater financial inclusion helps banks in reducing the volatility of their deposit-funding share as it provides more stable long-term funds for banks, while also mitigating the adverse effects of their return volatility. The association is stronger in countries with limited restrictions on banking activities or more capital regulation stringency as the deposit channel enables greater flow of low-cost funds for high-return investments. The results are robust to instrumental variable analysis, multiple dimensions of financial inclusion (supply, demand, and pro-access policy), and a difference-in-differences estimator that exploits cross-country and temporal variations in actively promoting an inclusive agenda, further confirming that inclusive financial development can be beneficial for banks.
About the speaker:
Professor Sushanta Mallick is a Professor of International Finance at the School of Business and Management, Queen Mary University of London, UK. Also, since January 2015, he has been the Co-editor-in-Chief of ‘Economic Modelling’ – a leading 35-year-old scholarly journal published by Elsevier. He holds a PhD in economics from the University of Warwick, UK. Before joining Queen Mary in October 2006, he held positions at the Department of Economics, Loughborough University, UK [2003-2006]; Royal Institute of International Affairs (Chatham House), London, UK [2001-2003]; JPMorgan Chase (previously Chase Manhattan Bank) based in Hong Kong [1999-2001], and Institute for Social and Economic Change (with a year at Indian Statistical Institute), Bangalore, India [1991-1995] where he began his research career followed by a Commonwealth Scholarship to study for a Ph.D. in economics [1995-1998] at the University of Warwick, UK. In addition to publishing a book from his Ph.D. research (Ashgate Publishing, 1999), he has contributed articles to 14 edited volumes along with publishing widely in many international refereed journals. He has published nearly 100 peer-reviewed journal articles, focused on issues in the areas of international macroeconomics, banking & finance, and innovation & development. He has researched different aspects of international finance and development at both the macro and micro-economic levels. As well as monetary and financial issues, his published research includes issues connected with growth, development, and poverty. He has also carried out a substantial amount of work on various aspects of macroeconomic modelling. His work has been published in journals such as: Journal of Corporate Finance, Journal of Banking & Finance, Journal of International Money and Finance, European Journal of Operational Research, Journal of Economic Behavior & Organization, Cambridge Journal of Economics, IMF Economic Review, Economic Inquiry, World Development, Journal of Development Studies, Industrial Relations, Review of Income and Wealth, Macroeconomic Dynamics, Journal of Macroeconomics, Physical Review E, Europhysics Letters (EPL), Physica A, and many others.
Moderator: Dr. Palka Chhillar, Assistant Professor, (Finance and Accounting), JGBS